How did the ANZ share price manage to beat the other ASX 200 big-four banks in February?

The ANZ Group Holdings Ltd (ASX: ANZ) share price is on course to end the month in a subdued fashion.

The banking giant's shares are currently down 0.1% to $24.80.

However, unless something drastic happens in the final hour of trade, ANZ's shares are on course to significantly outperform the rest of the big four this month.

The ANZ share price outperformance

As things stand, the ANZ share price looks set to record a monthly decline of approximately 1.1%.

While this is not exactly something to get investors excited, it is worth noting that the S&P/ASX 200 Index (ASX: XJO) is currently down 2.9% month to date.

Furthermore, compared to the rest of the big four, this is something to write home about. The next best performer in the group is the Westpac Banking Corp (ASX: WBC) share price with a 4.7% decline this month.

What's going on?

The catalyst for the outperformance of the ANZ share price has been the bank's strong start to FY 2023.

The market was expecting ANZ to fare well this year and this view was supported by the release of the bank's first-quarter update this month.

In response to the update, Goldman Sachs commented:

ANZ released its Pillar 3 disclosure for the quarter ended 31-Dec-22. Overall the update was slightly stronger that what was implied by prior 1H23 forecasts, driven by better volumes and asset quality remaining strong. 1Q23 CET1 ratio of 12.2% was 12 bp ahead of what was implied by our prior our forecasts.

Citi was equally positive and responded by naming ANZ as its top pick in the space. Its analysts commented:

ANZ's 1Q23 disclosures exhibited strong trends in both lending growth and asset quality. No earnings disclosure was provided, but we think that after backing out RWA movements from capital, it comfortably implies above market earnings, although subject to movements in deductions/reserves.

In light of this strong performance, Citi has put a buy rating and $29.25 price target on its shares. This implies potential upside of 18% for the ANZ share price from current levels.